Question:

Prepare for 4 years the following projected statements of the company

(1) Fixed asset valuation for depreciation purposes, (2)SLM depreciation as per company law, (3) Depreciation as per income tax act (WDV), (4)Provision for income tax, (5) Dividend for income tax, (6) Dividend (inclusive of dividend tax), (7) Projected profitability estimates

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A Capital Cost 1 2 Land & Site Development B Margin Money for Working Capital c Total Cost 3 The cost of project of Rita Jewelers Ltd. Is firmed up at Rs. 1500 Lakh as follows INR In Lakh Building Plant & Machinery Mis. Fixed Assets A Promoters B Others Preliminary Expenses Pre-operative expenses Contigency Margin Equity Share Capital Term loan Total The proposed means of finance for the project re firmed up as follows INR In Lakh Years Sales Realization Profit before non-cash charges Building Plants & Machinery Misc. Fixed Assets Further Information as below: Building Plant & Machinery Misc. Fixed Assets Projected sales and profit: The depreciation rates under the SLM for company law purposes are as follows: The depreciation rates under the WDV method are as follows 450 150 4 Preliminary expenses have to be written off equally over 5 ars Income tax provision is to be made @ 30% ignore surcharge and MAT Dividend is to be paid @ 15% in the 1st year and 2nd year and 17% therafter Dividend tax applicable 20% 2000 201.5 3.34% 4.75% 4.75% 10.00% 15.00% 15.00% 600 900 1500 INR In Lakh 2 2400 275.4 3 2700 351.45 4 2700 380.75 A Capital Cost 1 2 Land & Site Development B Margin Money for Working Capital c Total Cost 3 The cost of project of Rita Jewelers Ltd. Is firmed up at Rs. 1500 Lakh as follows INR In Lakh Building Plant & Machinery Mis. Fixed Assets A Promoters B Others Preliminary Expenses Pre-operative expenses Contigency Margin Equity Share Capital Term loan Total The proposed means of finance for the project re firmed up as follows INR In Lakh Years Sales Realization Profit before non-cash charges Building Plants & Machinery Misc. Fixed Assets Further Information as below: Building Plant & Machinery Misc. Fixed Assets Projected sales and profit: The depreciation rates under the SLM for company law purposes are as follows: The depreciation rates under the WDV method are as follows 450 150 4 Preliminary expenses have to be written off equally over 5 ars Income tax provision is to be made @ 30% ignore surcharge and MAT Dividend is to be paid @ 15% in the 1st year and 2nd year and 17% therafter Dividend tax applicable 20% 2000 201.5 3.34% 4.75% 4.75% 10.00% 15.00% 15.00% 600 900 1500 INR In Lakh 2 2400 275.4 3 2700 351.45 4 2700 380.75

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To prepare the projected statements for Rita Jewelers Ltd for four years we will calculate the following 1 Fixed Asset Valuation for Depreciation Purp... View the full answer